SINGAPORE: A local animal welfare group has released undercover videos of 25 dolphins that will be part of the attractions of the marine life park at Resorts World Sentosa (RWS).

The videos by Animal Concerns Research and Education Society (ACRES) showed the bottlenose dolphins, which were caught off the Solomon Islands, being tamed and trained in Subic Bay in the Philippines.A group of people were seen standing around a dolphin enclosure. As they watched the dolphins, several of the marine mammals occasionally jumped out of the water.

After completion of their training, they will be sent to RWS, as part of its interactive dolphin spa experience for visitors.

ACRES said one concern is the dolphins are being fed only dead fish, which is unnatural. It added that this is also highly stressful as wild dolphins are used to eating only fresh fish.

At a separate press conference on Friday, CEO of Resorts World Sentosa Tan Hee Teck, said Resorts World has followed the rules on the trade of endangered species.

He said: "All our dolphins in Subic Bay today are very healthy, and we hopefully will be able to bring them, what I call back home here, in the next 12 months."

In addition, a press statement from Resorts World said they employ world-renowned veterinarians for the Subic Bay facility, and have built a laboratory to regularly test the health of the dolphins.

The company came under fire last year after it was discovered that a smaller group of dolphins in Langkawi were kept under poor conditions.

Two of the dolphins died of acute bacterial infection called Melioidosis in October 2010. Melioidosis is a soil-borne disease, with infections occurring primarily during the rainy season.

After the issue came to light, the company moved the rest of the dolphins to the Philippines.

In conjunction with the release of the videos, ACRES has launched a "Save the World's Saddest Dolphins" music campaign.

It said it is not opposed to a marine park filled with species that are more adaptable to confined spaces. However, it is urging Resorts World to release the dolphins and allow them to roam free and wild in the ocean.

Louis Ng, Executive Director of ACRES, said: "The reality is that I think the small percentage of change in the size of the enclosure doesn't make a difference in the bigger scheme of things.

"We need to realise that these dolphins have a home range of over 40 square kilometres in the wild. Even if you give them another two by two metres, I don't think that makes much of a difference."

- CNA/cc/ac

We have followed the rules regarding our dolphins: RWS CEOSabrina Chan Today Online 28 May 11;

SINGAPORE - In his first public comments on the controversy surrounding the dolphins caught for the Resorts World Sentosa's (RWS) marine park, CEO Tan Hee Teck said they had followed the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) rules on the trade of endangered species.

The remarks were made on the same day an animal welfare group released undercover videos of the dolphins being tamed in Subic Bay in the Philippines.

Speaking at a press conference yesterday, Mr Tan said: "All our dolphins in Subic Bay today are very healthy and we hopefully will be able to bring them, what I call back home here, in the next 12 months."

The Animal Concerns Research and Education Society (ACRES) also held a press conference yesterday to step up its call for the release of the 25 dolphins bound for RWS Marine Life Park (MLP), where visitors will get to interact with them.

Calling the timing of their press conference a coincidence, the society said one of its concerns is that the dolphins are believed to be fed only dead fish, which is unnatural as they are used to eating only fresh fish.

Last December, Today had broken the story on how two of the RWS dolphins had died of acute bacterial infection called melioidosis, in Langkawi, in October.

Said ACRES executive director Louis Ng: "We need to realise that these dolphins have a home range of over 40 square kilometres in the wild. Even if you give them another two by two metres, I don't think that makes much of a difference."

An MLP spokesman told MediaCorp they will be as transparent as possible about their plans while ensuring the safety and well-being of their animals.

He confirmed the dolphins were from the Solomon Islands, where the government is a member of CITES.

SINGAPORE - A Singapore animal welfare group on Friday launched a campaign to urge a casino and leisure complex to free 25 dolphins destined for a new marine park attraction.

Resorts World Sentosa (RWS) bought the mammals for an "interactive dolphin spa programme" at its Marine Life Park attraction, where visitors can interact with the animals.

"We hope that RWS will make a socially responsible decision and free the dolphins," said Louis Ng, executive director of the Animal Concerns Research and Education Society (ACRES).

He issued the appeal at the launch of a campaign called "Save the World's Saddest Dolphins" to raise public awareness through songs and videos on the website www.saddestdolphins.com.

RWS, which runs Singapore's first casino as well as the adjacent Universal Studios theme park, had no immediate reaction, saying it was studying the campaign's allegations in detail.

ACRES invited the public to participate in the campaign by filming themselves making "save the dolphins" speeches or holding placards that will be sent to RWS via email, as well as uploaded on Facebook and YouTube.

"Using social media and by approaching this issue more creatively, we will be able to engage the public more effectively and reach out to a wider audience," said Ng.

ACRES said RWS bought 27 Indo-pacific bottlenose dolphins from the Solomon Islands in 2008 and two had died during training in the Philippines.

Group uses social media in bid to free dolphinsAcres launches petition drive for animals meant for RWS marine parkSandra Davie Straits Times 28 May 11;

ANIMAL protection group Acres has turned to social media to secure freedom for the 25 wild-caught dolphins intended for a marine park in Resorts World Sentosa (RWS).

It launched a campaign yesterday urging people to create and submit video petitions to free the dolphins, which are now being trained in Subic Bay in the Philippines to become performers.

Those who want to have a say can use their cellphones to shoot short video petitions, or take still pictures of themselves holding up placards, and upload them on Acres' campaign website at www.saddestdolphins.com

Acres, which stands for Animal Concerns Research and Education Society, is also holding roadshows this weekend at Far East Plaza. The petitions will be sent to RWS.

Acres executive director Louis Ng said the group decided to use social media after seeing its power at work during the recent general election.

RWS chief executive Tan Hee Teck, asked yesterday to comment on the condition of the dolphins in Subic Bay, said the company was following international rules on the treatment of marine animals.

Speaking on the sidelines of the official opening of RWS' Universal Studios, he added that the dolphins are 'very healthy' and are expected to be brought to Singapore in the next 12 months.

RWS followed up on Mr Tan's remarks with a statement, saying the animal care team was providing the 'very best care' to the dolphins, including a superior diet, daily enrichment and veterinary attention.

RWS incurred the wrath of animal activists when it announced in 2006 that it would house dolphins in a massive tank in its Marine Life Park attraction.

Nine of the 27 bottlenose dolphins from the Solomon Islands were housed in sea pens in Langkawi in Malaysia. In October last year, two dolphins died. RWS said this was due to a bacterial infection that also affects the mammals in the wild.

Earlier this year, Acres sent its people to Langkawi and produced photographs which showed that the dolphins' enclosures were too small and rusty, among other things. RWS later moved the remaining animals to the Ocean Adventure park in Subic Bay.

Mr Ng said Acres was not opposed to a marine park filled with species that take well to confined spaces, but dolphins roam large distances and should not be confined.

SINGAPORE: Resorts World Sentosa (RWS) said it's "on track" to open the second phase of its integrated resort, which includes a maritime museum, an aquarium and a marine life park.

These attractions will open progressively from the third quarter, this year, beginning with the museum.The marine life park is expected to open fully by mid-2012.

RWS said it's expecting 16 million visitors this year, up from 15 million in 2010.

Universal Studios Singapore is also projecting 4 million visitors this year, double the number in the first nine months of its soft opening in March 2010.

These numbers were released at a news conference ahead of the theme park's grand opening on Saturday.

Celebrations include a Hollywood-style gala dinner on Friday, which will be attended by celebrities such as Paula Abdul, Jet Li and Maggie Cheung.

- CNA/cc

RWS sets target of more than 16m visitors

Phase two expansion of integrated resort on track, says Genting chairmanFelda Chay and Teo Si Jia Business Times 28 May 11;

RESORTS World Sentosa (RWS) is looking to up its game this year, having set a target for 16 million visitors to head to the integrated resort - an increase from the 15 million last year.

In fact, the resort's owner, Genting Singapore, is confident that it will get even more visitors than that. Speaking at a press briefing on the grand opening of Universal Studios Singapore yesterday, Genting Group chairman and chief executive Lim Kok Thay said: 'This year, I'm convinced that Resorts World Sentosa will be able to attract more than 16 million visitors.' Genting Group is the parent of Genting Singapore.

Universal Studios alone is expected to see four million visitors, said the group. The theme park drew two million visitors in 2010, during which it was open for about nine months following its soft launch in mid-March. Prior to the launch of the 20-ha theme park, RWS had said that it believes it can pull in 4.5 million to five million visitors annually.

The theme park, which opens its doors to the public today, kickstarted celebrations yesterday with appearences by by pop singer and former American Idol judge Paula Abdul, action star Jet Li and actresses Maggie Cheung and Vicki Zhao Wei.

The park will be 'progressively opening' new attractions as it goes along, with a Transformers ride scheduled to be open by the end of this year, said RWS. This will bring the park's number of attractions to 21. The plan is to up the number of attractions to 24 by 2013 - a strategy that Universal Studios hopes will lure return visitors.

Currently 75 per cent of visitors are made up of foreigners. According to Mr Lim, this is a situation unique to Singapore where the local population is not as large as the UK or US.

Universal Studios will also be extending its opening hours, and will close at 9pm instead of 7pm with effect from May 30, said RWS.

In the first quarter of this year, Genting Singapore managed to reverse a $396.3 million loss and make $305.4 million in profit for the period, as gaming tables at RWS benefited from healthy attendances.

Yesterday, Mr Lim also clarified that the second-phase expansion of its gaming resort is 'on track'. This is despite Genting's statement on Thursday that its expansion has encountered some 'unforeseen difficulties' which may delay its completion.

'What we announced probably was something to sort of be a bit on the prudent side because it's sort of a pre-warning so that people won't get disappointed if we do miss our target date, which is to complete most of phase two by the end of the year,' said Mr Lim.

'Some of the elements that are involved in phase two have never been done before. But again let me say that we are right on top of it . . . but sometimes we just cannot avoid unexpected incidents.'

Phase two involves the construction of the world's largest oceanarium. 'So in terms of the frontage, the acrylic frontage of the aquarium, this would be one of the largest pieces of acrylic ever made in one whole and transported halfway round the world. So anything may happen.

'Let's say something happens to that, because it is made in one continuous piece, we may have to start all over again,' said Mr Lim.

Yesterday, Genting also gave a sneak peak into its expansion plans. Mr Lim said that the Genting Group was interested to venture into Taiwan. 'We are following the (gaming) legislative process in Taiwan with great interest and naturally at the right time if Taiwan is ready to open ... an integrated resort in Peng Hu we definitely will be right there,' said Mr Lim. Peng Hu is a cluster of 90 small islands and islets off the western coast of Taiwan.

RWS to open phase two by year endIt's expected to kick off in 3rd quarter, and pull in 16m visitors this yearNg Kai Ling Straits Times 28 May 11;

RESORTS World Sentosa (RWS) is on track to open its phase two by year's end.

Starting with the opening of its Maritime Museum in the third quarter, it will also raise the curtains on the hotel Equarius, its oceanarium and its water theme park this year.

RWS' executive chairman Lim Kok Thay said yesterday that the resort's phased opening was proceeding according to schedule, and expressed confidence that it will pull in more than 16 million visitors this year, up from last year's 15 million.

His assurance follows an earlier announcement from the RWS management about 'unforeseen difficulties' delaying the completion of the second phase.

He said the announcement came from prudence and 'a bit of over-carefulness' on the management's part:

'It was sort of a pre-warning so that people won't get disappointed if we do miss our target date, which is to try and complete most of phase 2 by the end of the year.'

A potential hiccup, if there is to be any, could come from the setting up of the facade of the oceanarium, which is made up of a single piece of acrylic measuring 33m by 11m.

'If something happens to that - because it's made in one continuous piece - we may have to start all over again,' said Mr Lim, who is also chairman and chief executive of RWS' parent company, Genting.

He was speaking at a press conference to mark the grand opening of Universal Studios Singapore (USS) last night.

Guests at the event included international action star Jet Li, screen queen Maggie Cheung and former American Idol judge Paula Abdul (see other story).

Despite being the smallest Universal Studios theme park in the world, the 20ha USS features many firsts:

The recently opened ride Madagascar: A Crate Adventure is the only one based on the popular movie franchise.

A Transformers ride will also debut at USS by the end of the year. Calling Transformers The Ride 3D a 'ground-breaking attraction', Mr Tom Williams, the chief executive of Universal Parks & Resorts, said: 'I promise you that this attraction is absolutely spectacular.'

Back in 2006, the inclusion of a Universal Studios theme park was considered the clincher which won Genting the bid to build an integrated resort in Sentosa.

Mr Lim said yesterday the decision to have a Universal Studios theme park in RWS was an easy one to make.

He said: 'I love the movies. Movies appeal to all ages and they inspire people from all walks of life.'

USS hit a rough patch within a week of its opening, when its star attraction, the Battlestar Galactica roller coaster, ran into safety issues. It continued to be out of commission for the most part of the first nine months of the park's operations.

Despite that, the park attracted about two million visitors, three quarters of them foreigners. It expects to double its attendance to four million this year.

In the last quarter, RWS' pre-tax profits of $537.9 million trumped its competitor Marina Bay Sands' performance of US$284.5 million (S$352 million).

Asked how RWS will manage the social ills arising from gaming, Mr Lim said the company's goal was to build a resort that would contribute to building Singapore. It was a reference to the resort's capacity to create jobs and contribute to growing the economy.

Mr Lim added: 'Of course, gaming forms a significant part of our revenue, but we are confident that we can come up with solutions to keep the problems well under control.'

Taiwan casino?

THEY are a scenic group of islands that some believe would make an ideal location for a casino.

Which is why Genting chairman Lim Kok Thay has been keeping an eye on Taiwan's Penghu archipelago.

The islanders successfully voted against having a casino there in 2009.

But the possibility still remains, with some analysts saying the Taiwanese government could give the green light to a casino as early as this year.

Mr Lim wants to take his experience from Resorts World Sentosa to Taiwan.

'One of the big parts of our business is in gaming,' he said.

'And obviously we are following the legislative process in Taiwan with great interest. When the Taiwan government is ready to open its door for an integrated resort in Penghu, we will be right there.'

He added that the integrated resort model is being studied by governments all over the world as it is a great driver for tourism and the economy.

SINGAPORE - Less than a day after its parent company, the Genting Group, said in a filing to the Kuala Lumpur Stock Exchange that the completion of its second phase could be delayed, Resorts World Sentosa (RWS) chairman Lim Kok Thay yesterday played down the possibility.

Speaking at a press conference, Mr Lim said that the resort was "on track" for its phase two opening later this year and that he was confident that it will attract more than 16 million visitors this year, up from last year's 15 million.

On Thursday, Genting had said in the stock exchange filing that the RWS is "encountering some unforeseen difficulties" which may delay the completion of the second phase.

Mr Lim said the announcement was made out of prudence and he described it as "a bit of over-carefulness on the management's part".

He added: "It was sort of a pre-warning so that people won't get disappointed if we do miss our target date which is to try and complete most of phase two by the end of 2011."

The integrated resort will roll out its attractions under phase two from the third quarter, starting with its maritime museum. Its Marine Life Park will open by the middle of next year.

It announced that it had completed the structure of its fifth hotel, Equarius, one of two new hotels under phase two yesterday.

Mr Lim said he was open to acquiring more land for expansion but he noted that the focus was to complete the rest of the resort.

The RWS houses the Universal Studios Singapore theme park - which will hold its grand opening today - among other attractions.

Weighing in on the issue, Universal Parks and Resorts chairman Tom Williams reiterated that "size is really irrelevant".

Said Mr Williams: "It is all about the quality of the experience, the exciting nature of the rides and shows and attractions."

The theme park of about 20 hectares has 21 rides and shows, with three more attractions in the pipeline which were be completed by 2013.

In the nine months after its soft opening in March last year, the theme park attracted about two million visitors. It is projecting four million visitors for the whole of this year.

SINGAPORE - The Bukit Timah Railway Station has been officially gazetted as a conserved building, as of Friday.

This follows the gazetting of the Tanjong Pagar Railway Station as a National Monument on April 8.At their retreat last year, the Prime Ministers of Singapore and Malaysia announced in their joint statement that the Keretapi Tanah Melayu Berhad (KTMB) station would be relocated from Tanjong Pagar to the Woodlands Train Checkpoint (WTCP) by July 1, this year.

Along with the Tanjong Pagar Railway Station Passenger Terminal building, both leaders also agreed that the old Bukit Timah Railway Station building at Blackmore Drive could also be conserved, given its historical significance. Both would then cease to operate as KTMB railway facilities.

The Urban Redevelopment Authority (URA) said the Bukit Timah Railway Station was an endearing local landmark and a key building of Singapore's railway history, and its conservation would serve as a physical reminder of Singapore's role as a transport hub in the region.

The government on Thursday countered claims by environmental activists that the recent two-year moratorium on new permits to clear primary forests and carbon-rich peatland was too flawed to preserve the country’s forests.Speaking at a discussion on the moratorium, Yani Saloh, a presidential adviser for climate change, said: “This moratorium is a breakthrough. We’ve had six presidents, and this is the president who has the courage to actually do it.”

Since the long-awaited moratorium was announced last week, environmental activists have been voicing their disappointment to what they perceive as a weak and unclear regulation. Critics have said the ban covers too little of the country’s forests and should have included existing logging concessions.

Teguh Surya, head of climate justice at the Indonesian Forum for the Environment (Walhi), said at the discussion that the moratorium lacked a strong legal basis to curb logging practices.

“What we need is a law. A more comprehensive regulation with a wider impact,” he said.

Yani said President Susilo Bambang Yudhoyono decided to announce the moratorium in the form of a presidential instruction because a law would have taken too long to ratify.

“A law would have to be deliberated at the House of Representatives; the process can take a very long time. By the time the law is passed, our forests would be gone,” she said.

Yani said she was also aware most criticisms were over the fact that the moratorium only covered primary forests and peatland, already under some legal protections.

A map attached to the moratorium documents shows that 64.2 million hectares of primary forest and 31.9 million hectares of peatland were covered, but not 36.6 million hectares of secondary forest. Primary forests are untouched by agriculture or industry, secondary forests are areas already partially cleared for agricultural or industrial use.

Yakob Isadami, a staffer for Aceh Governor Irwandi Yusuf, said that Aceh was ahead of the central government in implementing a moratorium on forest clearing due to rampant illegal logging there. Aceh implemented the moratorium in 2007.

Transtoto Handadhari, vice chairman of the Indonesian Forest Concessionaires Association (PAHI), said the organization was satisfied with the moratorium because it had accommodated most input given by the members. “We will support the instruction as long as the implementation is fair and proper,” he said.

WASHINGTON (AFP) – The United States on Friday rejected calls to protect Atlantic bluefin tuna as an endangered species, saying that while it was worried about overfishing it did not fear imminent extinction.Environmental groups have repeatedly voiced concern that the global fad for Japanese food was driving the world's stocks of tuna to dangerously low levels and have sought strong safeguards to preserve the species' survival.

The National Oceanic and Atmospheric Administration said it was putting Atlantic bluefin tuna on a watchlist of species at risk but would not classify it under the Endangered Species Act, which would bring legal protections.

"Based on careful scientific review, we have decided the best way to ensure the long-term sustainability of bluefin tuna is through international cooperation and strong domestic fishery management," said Eric Schwaab, a senior official at the agency.

He said that the United States would continue to advocate strict international quotas on the number of tuna that can be hunted to "ensure the long-term viability of this and other important fish stocks."

The administration pledged to review its decision in early 2013. Clay Porch, a senior federal scientist, acknowledged that the study of tuna stocks in the Gulf of Mexico was conducted mostly before the massive BP oil spill.

Porch said 2010 tuna stocks were down but that the drop could be within normal fluctuations. To be listed as endangered, a species must be found to be at threat of extinction within a definable time frame.

The United States last year led a push to ban the international trade in Atlantic bluefin tuna, but the proposal was easily defeated at the UN Convention on International Trade in Endangered Species after intense lobbying against the plan by Japan and opposition by some European nations.

A separate meeting of the International Commission for the Conservation of Atlantic Tunas, which groups 48 major fishing nations, decided in November to trim the catch quota only modestly to 12,900 tons in 2011.

US authorities said, however, that they saw a better outlook for tuna amid the growing international attention.

"The new quotas that were set forth at the last convention provide a significantly better picture, providing we have sufficient compliance, than might have existed before," Schwaab told reporters on a conference call.

Senator Olympia Snowe hailed the decision, saying that an endangered listing would have jeopardized the livelihoods of fishermen in her coastal state of Maine.

"Such a listing would have unilaterally penalized US fishermen, particularly the hard-working responsible fishermen of Maine, who have been properly managing this valuable resource," the Republican lawmaker said.

The federal government considered the request to protect tuna after a petition by the Center for Biological Diversity, an environmental group, which said that the BP oil spill threatened tuna's breeding habitat.

Catherine Kilduff, a staff attorney at the center, said that the group would review the government's findings and left open the possibility of going to court to ensure the conservation of tuna.

The center has called for a consumer boycott, through which it said 22,000 people have pledged not to eat at restaurants that serve bluefin tuna.

"If there is a grassroots movement to stop consumption of this species, then it will also tell political leaders that no longer can their decisions be made just based on the industry's greed to keep overfishing," Kilduff said.

U.S. Declines to Protect the Overfished Bluefin TunaFelicity Barringer New York Times 27 May 11;

The Obama administration said on Friday that it had declined to grant Endangered Species Act protections to the Atlantic bluefin tuna, whose numbers have declined precipitously because of overfishing on both sides of the ocean.

The National Oceanic and Atmospheric Administration said the fish, whose fatty flesh is prized by sushi aficionados, would be classified as a species of concern, however, effectively placing bluefin on a watch list as the agency awaits new data on the impact of a stricter international management regimen.

“The future of this species relies on sound international management,” said Larry Robinson, NOAA’s assistant secretary for conservation and management. The agency’s scientists are also continuing to assess the effect of last year’s Deepwater Horizon oil spill on bluefin spawning grounds in the Gulf of Mexico, officials said, and the agency will revisit its decision by early 2013.

Mr. Robinson said the bluefin tuna did not warrant protection under the Endangered Species Act because it was “not likely to become extinct.”

The decision drew sharp criticism from the Center for Biological Diversity, an environmental group based in Arizona that filed the petition requesting endangered species protection. “The Obama administration is kowtowing to the fears of the U.S. fishing industry instead of following the science on this,” said Kieran Suckling, the center’s executive director.

Several other environmental groups have questioned the wisdom of unilaterally listing the bluefin tuna as an endangered species, saying that coordinated international action is preferable.

Last year the United States backed an international effort to have the Atlantic bluefin protected under the United Nations Convention on International Trade in Endangered Species, but the move was blocked by aggressive lobbying by Japan, where a single adult fish, weighing more than 300 pounds and measuring more than six feet long, can be sold for thousands of dollars.

Asked to reconcile Friday’s decision with the push for a listing by the convention, known as Cites (pronounced SIGH-tees), Eric Schwaab, assistant administrator for NOAA’s fisheries service, said that another global body, the International Commission for the Conservation of Atlantic Tunas, or Iccat, had established stricter fishing quotas and more rigorous monitoring over the last year and that his agency planned to study the results.

He added that a listing under the Endangered Species Act required a different standard from a Cites listing; under the American law, there must be compelling evidence of the likelihood of the fish’s extinction, he said.

No one disputes that the bluefin population has plummeted in recent decades. The most recent analysis of the decline, prepared last year by Iccat, found that the eastern Atlantic’s stocks of fish old enough to reproduce declined by 80 percent between 1970 and 1992 and have since fluctuated between 21 percent and 29 percent of the 1970 level.

In the western Atlantic, bluefin stocks declined more than 70 percent from 1970 through the mid-1990s, after which the “spawning stocks” remained relatively stable.

Lee Crockett, director of federal fisheries policy for the Pew Environment Group, another conservation organization, said that multilateral efforts to protect the bluefin tuna were crucial but that “international tools are not being used effectively.” Fishermen in the Mediterranean catch “twice the legal quota illegally,” he said.

Nor does the United States do enough, he added. Mr. Crockett said that additional steps were needed to protect the bluefin tuna’s spawning areas in the Gulf of Mexico and to end log-line fishing there, which causes the bluefin to be caught accidentally by commercial fishermen in pursuit of other fish.

The American fishing industry welcomed NOAA’s decision, while assigning most of the blame for overfishing to fishermen on the other side of the Atlantic. “We’re glad that the leadership paid special attention,” said Rich Ruais, executive director of the American Bluefin Tuna Association.

Overfishing in the east has affected stocks in the west, Mr. Ruais said, because the fish is wide-ranging and can swim across the Atlantic in less than two months.

A prolonged drought in China could hit grains output in key growing regions, further squeezing global supplies and putting upward pressure on prices, but plentiful domestic wheat stocks will act as a cushion and keep import volumes low.

Analysts are closely watching the weather in China, warning any further supply shocks in the grain markets would fuel a further rally in U.S. corn and wheat futures, already stoked by harsh crop weather in the United States and Europe."Parts of China have been too dry and if we did see crop failures in that part of the world they are going to look to the global market for supplies," said Luke Mathews, a commodity strategist with Commonwealth Bank of Australia in Sydney.

"They are going to be looking to North America and Europe and there is significant amount of concern whether those particular countries will be able to satisfy those needs."

Chicago Board of Trade corn has climbed 80 percent since the start of May last year, while wheat has risen around 50 percent. Last week alone corn and wheat jumped more than 10 percent on expectations of a global squeeze in supplies.

CROP CONCERNS & TIGHT GLOBAL SUPPLIES

Timely corn seeding is crucial for optimal yields needed to replenish U.S. supplies that are projected at the lowest level in 15 years amid strong demand from livestock feeders, ethanol makers and exporters.

About 80 percent of the U.S. corn crop has been planted, according to the U.S. Agriculture Department, but showers this week are expected to bring the final corn seedings to a standstill.

Rains in the northern U.S. Plains have put spring wheat plantings behind schedule, with seeding only 34 percent complete in the top wheat state of North Dakota, down from the normal pace of 85 percent.

CORN FORECAST, INFLATION

A Chinese government think tank has forecast 2011 corn output will rise to a record 181.50 million tonnes due to increasing acreage, but analysts said it would be a tough target to achieve.

"The 180 million tonnes level is a bottleneck, and the general market forecast, which is yet to come, should be lower than the forecast," said an analyst with consultancy China Corn.

China's corn prices hit an all-time high in March. That, coupled with low state corn reserves, made it difficult for Beijing to cool food price rises, driving up the country's overall inflation rate to a 32-month high in March.

Food prices fell 0.4 percent in April from March but were 11.5 percent higher than a year earlier.

"Global corn supplies are extremely tight and the world is banking on sharp increases in production," said Mathews. "Chinese authorities were suggesting a lift in local production and they will need every bit of that."

Barclays Capital warned that recent extreme weather incidents have created upside risks to food inflation for the second half of 2011, citing China as one of the areas of concerns.

"Drought-like conditions in the Yangtze River basin and eastern Shandong are likely to weigh on Chinese food production and increase import demand," the bank said in a report.

"Shandong has received just 12 millimeters of rain since September 2010, with some reports indicating that around 40 percent of the province's wheat crop has been lost."

China's total wheat output stood at 115 million tonnes last year, official figures showed.

However, Hai Yang, a wheat analyst with Esunny Information & Technology Co., said China is likely to see a slight wheat output increase this year.

Water levels on the Yangtze midstream are 6 meters lower than they were the same time last year, with rainfall only a fifth of the levels seen in 2010, according to the China Daily newspaper, quoting local drought relief agencies.

China's meteorological administration said on Wednesday that average rainfall in Anhui, Jiangsu, Hunan, Hubei, Jiangxi, Zhejiang and Shanghai, which are China's major rice producing areas, is the lowest since 1954.

STOCKS, IRRIGATION

The market is not overly concerned about wheat supplies in China with closing stocks at the end of crop year 2010/11 estimated at 60 million tonnes by the USDA.

"The weather this year is likely to be abnormal, with northern China likely experiencing floods while southern China likely sees drought," said Gao Yanrong, an analyst with Dalu Futures.

Officials in China said irrigation facilities will limit the risk to the corn crop even if there is drought later on in the main growing areas.

"We have wells, and we can irrigate (the corn) even if there is a drought," said a farm ministry official in Shandong province.

China turned corn importer last year, buying 1.57 million tonnes, the most in 15 years, and almost all came from the United States. In March, China Grains Reserve Corp (Sinograin), which manages China's central government reserves, bought 1.0 million tonnes of U.S. corn.

The country is also seeking other origins and developing new sources for supply. Argentina's deputy agriculture minister, Oscar Solis, said in April that the country hopes to work out a health protocol and export up to 2 million tonnes of corn to China this year.

Analysts say the weather in July-August, which is the crucial growing period, will be the deciding factor to final output.

A bidding war is heating up among users of corn in the United States as livestock feeders and ethanol makers scramble to lock in supplies before extremely low stocks run dry by this summer.

And it could escalate even more with any delay in harvesting the crop in the flood-ravaged U.S. South, or if China steps into the market to buy the grain held over from last year's harvest, as persistently rumored.Corn supplies are forecast to fall to their lowest level in 15 years this summer in the U.S., the world's top exporter of the grain. Those holding stocks, like commercial grain companies, could reap handsome profits ahead of the Midwest harvest in September.

But those who have sold corn they do not own, such as resellers, could face losses if they are unable to deliver.

In markets such as Decatur, Illinois and Clinton, Iowa, published spot cash corn prices have risen a few cents above CBOT July futures for the first time in several years.

Also, the average posted bid at interior locations for corn delivered in August is at a 5-cent discount to CBOT September futures. That's the smallest average discount in at least five years, said Cody Bills, a broker with Grain Hedge, a research firm in Bozeman, Montana.

But behind the scenes, brokers say middlemen and small users such as independent feed mixers have been paying much higher prices -- 50 cents or even $1 above CBOT July futures.

"Most (eastern) Midwest corn sales are occurring well above published bids as end-users try to keep quiet what their need for corn is and where the market is," research company AgResource Co said Tuesday in a note to its clients.

Corn supplies are typically tighter in the eastern Midwest than in the western section, and especially so this year after 2010 yields suffered from the weather.

Such demand, coupled with concerns over rains delaying the seeding of the 2011 crop, drove corn futures on the Chicago Board of Trade to an all-time high of $7.83-3/4 a bushel last month. Prices then dipped below $6.60 by mid-May as Wall Street investors broadly shed commodity holdings.

Farmers have sold most of last year's harvest, and are clinging to the remainder until they grow more confident about prospects for the new crop, said Chad Hart, an agricultural economist with Iowa State University.

"They are hanging on to it for dear life," Hart said.

As a result, corn offerings from the country have shut down. And planting delays, due to excessive rains, have dashed hopes for an early harvest that might relieve tight supplies at summer's end.

The empty supply pipeline appears to have squeezed corn resellers -- independent middlemen who make a living by matching buyers and sellers.

"When I pay 50 (cents) over, it's not because I can make money doing it. It's because I have sold something I don't own," said Roy Huckabay of Linn Group, a Chicago brokerage and research firm.

"I think some of these resellers have made a mistake of selling something they didn't own. That's the issue," he said.

COMMERCIALS HOLD THE ACE?

As of March 1, commercial grain firms owned a large percentage of the corn harvested last year in the U.S. Farmers held only 52 percent of the domestic corn supply, down from 59 percent a year earlier, the U.S. Department of Agriculture stated in its latest quarterly stocks report.

"The strong basis levels being experienced in many areas may reflect relatively small inventories remaining in the hands of producers," University of Illinois agricultural economist Darrel Good said.

But the big commercials such as Archer Daniels Midland, Cargill and Bunge are believed to have sold most of that corn to protect themselves from a drop in prices once the 2011 harvest begins this fall, traders said.

"With July corn (futures) trading at an inverse to the December, any elevator manager in his right mind is not going to own it. He is going to have it sold," Huckabay said.

WHO'LL WIN OUT?

It's hard to say which industry is best-placed to claim the last bushels of 2010 corn, but traders say ethanol plants seem to have the early advantage. Profit margins for ethanol refiners have been improving and government data showed production rose in each of the last two weeks, reversing a downward trend.

Feedlots in the western U.S. Plains also need corn, and unlike ethanol plants that can reduce their corn grind, livestock producers cannot slow their herds' food consumption when profit margins sag.

"Feed margins have come down, but if you have animals out there, you need to feed them," Klemme said.

Exporters are also in the mix. U.S. corn export sales surged to a seven-week high by May 12, even as flooding on the Mississippi River interrupted the flow of grain to the primary U.S. export terminals in New Orleans.

So who will win the bidding war?

"The market will determine who wants it the most" was the way Klemme put it.